A
British Columbia employment lawyer asks why class actions have
not been used as much as they could in his province to enforce
workplace rights, especially in light of the recent cuts to
administrative tribunals.

By Leo
McGradyVancouver

Leo McGrady

In British Columbia, the Class Proceedings Act,
R.S.B.C. 1996, c. 50, has been overlooked as a tool for
enforcing rights for non-union employees. There are four areas
of statutory regulation of the workplace where class actions
could be effective: employment standards, human rights,
privacy rights and, perhaps, workplace safety.

Counsel
in jurisdictions other than B.C. have been more active in
asserting these rights. In the U.S. we’ve seen a remarkable
series of employment class action cases in the past year. On
September 13, 2005, employees from a number of countries,
including the U.S., China and Indonesia, sued Wal-Mart in the
California Superior Court in Los Angeles. Their claim includes
complaints over substandard wages, excessive hours, as well as
false statements about the company’s human rights practices www.laborrights.org/press/Wal-Mart/lawsuit.

Amaral
et al v. Cintas Corporation is a noteworthy recent
example of the use of class actions to enforce employment
rights. In September 2005, in the city of Hayward, California,
a court ordered Cintas Corporation to pay 219 workers more
than $1 million in back pay. Cintas Corporation had agreed to
comply with the city’s living wage ordinance as part of its
contract with the city as its official launderer. It did not
comply, and in fact paid substantially less to all its
employees over a 4-year period (San Francisco
Chronicle, September 27, 2005, page B3).

In
British Columbia, the provincial government’s budget cuts
through the 2002/2003 fiscal year resulted in reductions in
the order of 25 per cent to 30 per cent, on average, to some
of the administrative tribunals charged with the enforcement
of key workplace rights, including employment standards, human
rights, workers’ compensation, and privacy/freedom of
information. These cuts were imposed at about the same time as
we were beginning to realize that many of the new jobs being
created in Canada were in fact temporary, part-time, carried
no contractual benefits, and generally reflected a significant
decline in what economists describe as “employment quality”.
See “Quantity: Yes, Quality: Not Yet”, CIBC World Market’s
Report (Jan. 30, 2006): www.cibcwm.com/research.

The
impact was particularly acute in the Employment Standards
Branch, where staffing was reduced by a third – from 151 to
109. The number of branches province-wide was reduced by
almost one-half – from 17 to 9 (a 47 per cent reduction): see
D. Fairey, Eroding Worker Protections (Vancouver, BC:
Canadian Centre for Policy Alternatives, November 2005, page
29).

Thus far, there have not been any British Columbia
cases brought under the CPA seeking relief for an employer’s
failure to meet Employment Standards Act obligations.
This is in contrast to Ontario where there have been at least
three cases against employers for failing to provide wages
including overtime pay, holiday pay, vacation pay, termination
pay and severance pay. The following cases were framed as a
breach of implied contractual terms as opposed to a cause of
action based on a breach of statute.

In Wicke v.
Canadian Occidental Petroleum Ltd., [1998] O.J. No. 2818
(Gen. Div.), the court certified a class of approximately 70
employees with the common issues of entitlement to overtime
pay, and punitive and exemplary damages.

Then in
Halabi v. The Becker Milk Company Limited et al.,
[1998] O.J. No. 2662 (Gen. Div.), the court refused
certification. It reasoned that since the administrative
scheme under the Ontario ESA was quick, cost the employee
nothing, and did not require judicial intervention, a class
proceeding was not the preferable procedure. It is doubtful
whether such a description would apply to the current ESA
regime in British Columbia.

Halabi was
distinguished in Kumar v. Sharp Business Forms Inc.,
[2001] O.J. No. 1729 (S.C.). Kumar was a claim by
approximately 50 employees for unpaid overtime, holiday and
vacation pay. The court in Kumar recognized that the
Act expressly provided for civil actions as an alternative to
the administrative procedure under the Act. The court
noted that one of the purposes of the Ontario CPA was to
enhance access to justice and not restrict it. The court
certified the action.

In British Columbia, s. 118 of
the ESA states that nothing in the ESA affects the right of a
person to commence and maintain an action except if there has
already been a Director’s decision on the matter. Kumar is
persuasive authority for using the CPA as a tool for enforcing
employee rights.

The main advantage to bringing an
action under the CPA when an employer fails to meet its ESA
obligations is the amount of wages to be recovered. If an
employee were to proceed through the administrative process of
the ESA, they would be limited to the amount of wages payable
in a pay period of six months before the earlier of the date
of the complaint or the termination of the employment (s. 80).
Consequently, if an employee’s entitlement to wages extends
beyond this six-month period, the employee would only be able
to collect for a maximum of six months under the ESA scheme.
As set out in Kumar, the cap on recovery does not apply to a
civil action.

A further advantage to using the CPA is
that once certified, members of the class are automatically
covered by any award unless they decide to “opt out”. In
contrast, the ESA has no provision to consolidate complaints
through a representative complainant.

Despite the
advantages of recovery and consolidation of complaints, the
CPA remains under-used for enforcing employee rights when
employers have not met their obligations set out in the ESA.
The reasons for this appear to be both delay and
cost.

In British Columbia, it will take several months,
sometimes 6-8 months, simply to have a case management judge
assigned. To tackle the delay, British Columbia should assess
whether or not to adopt the Ontario model, which uses a
handful of judges who specialize in hearing class action
cases. This could speed up the process. Motions could be dealt
with on an expedited basis with succinct written submissions
and no requirement for an oral hearing. Case management
through conference calls can also speed the process when a
party is making unreasonable demands.

Costs of class
actions can be mitigated through the use of advocacy groups
being appointed as representative plaintiffs through s. 2(4)
of the CPA. Section 2(4) of the CPA allows the court to
certify a person who is not a member of the class as the
representative plaintiff for the class proceeding in order to
avoid a substantial injustice to the class. This section would
work particularly well with respect to farm workers and other
historically disadvantaged employees.

However, at the
moment, delay and cost are stumbling blocks to using the CPA.
Strategies to reduce delay are needed to meet the access to
justice goal of the CPA. The correction of these deficiencies
remains an issue of some concern for employment lawyers
generally. That is particularly so for those considering the
use of class actions as at least a temporary solution to
address the problems created by the under-funding of the four
tribunals charged with the enforcement of key workplace
rights.

Leo McGrady is an employment law lawyer with McGrady
Baugh and Whyte in Vancouver. He has written and spoken
extensively on the issue of the enforcement of employment
rights.